HMRC’s IT head outlines Making Tax Digital rollout

25th October 2018 | News

The head of software development collaboration at HM Revenue and Customs has spoken of the tax authority’s number-one priorities, including Making Tax Digital.

Lee Hawksworth, HMRC’s IT head, discussed the new API development programme that will underpin the new MTD software interface and allow software developers to embed MTD information into accounting software.

“HMRC now has the biggest digital operation in government and we are looking to share our API strategy across government,” said Hawksworth at the recent Iris World annual conference.

“This represents a significant change in IT approach which before was managed through the Aspire outsourced contract, which has been disbanded.

“Under the current technology stack, there is a progressive movement to the cloud, so the systems are not held on premise.

“The current API programme [for MTD] is almost at completion, offering third party integration.”

Hawksworth confirmed that another key priority for HMRC is to overhaul the Government Gateway as it is “not fit for the modern world”.

“It uses a static ID and user password, which is not a good idea now,” added Hawksworth.

“Going forward, people using the Personal Tax Account will have to go through ID verification with two-factor authentication.”

HMRC’s IT department now boasts 1,000-plus specialists, processing two billion transactions annually via 13 digital tax services. It’s all part of a plan to create the “most digitally advanced tax administration in the world”, according to Hawksworth.

“With the API gateway, we have been able to increase the amount of tax revenue collected in 2017/18 to £605bn from £500bn in 2013/14, despite 40% staff cuts since the Revenue and customs merged,” concluded Hawksworth.

If you are a small business or a self-employed individual with a turnover above the current VAT threshold (£85,000) you will be required to keep digital records for VAT purposes from April 2019.

Furthermore, small firms and self-employed individuals earning below that threshold will be required to report their taxes via the new MTD system from April 2020.

Small Business Minister, Kelly Tolhurst MP recently confirmed there will be no further delays to the rollout of the digital tax system.